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Advertising.com Group follows lead of Google, Amazon

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AOL Inc. officially launched the Advertising.com Group earlier this month. The group, which consists of Adtech, Advertising.com, AOL Answers, 5min, GoViral, Pictela, Seed and StudioNow, offers digital advertising and content services to publishers, advertisers and agencies.
Ned Brody has been tapped to lead the effort as president of the Advertising.com Group, which offers publishers and marketers the combination of an ad network, an ad management platform, online video and content solutions. Brody discussed the new group with Digital Directions.
Digital Directions: What is the thinking behind the Advertising.com Group?Ned Brody: It's really to provide a unifying vision for both employees and for our constituencies in the market, which would include publishers, advertisers and agencies. The metaphor for this is what Google and Amazon did in their businesses. You probably remember that Google was Google.com. They were a destination site and then, along the way, they became very good at what they did. Then they said, “We can help other companies monetize their businesses.” And then you saw the accretion of AdSense and AdWords.
A similar thing happened with Amazon.com. They set out to be the best e-commerce company. Along the way, they said, “In order to do that, we really have to become the best at a number of things—package-ship operations and virtual hosting.” And you saw them create a separate business line in what became Amazon Web services, which is used by almost every startup in the industry now.
So we took a page from that. Internally, through a number of acquisitions, we have aggregated a set of businesses that can focus on driving yield for publishers and solving problems for advertisers looking to put their premium dollars to work.
DD: What does the combined group offer publishers?Brody: What we're really trying to do in the marketplace is solve what we think is the biggest pain point for publishers and advertisers. If you're a publisher—be it Hearst, or Condé Nast or anybody in the marketplace—you've seen that the online advertising business has grown really quickly, in double-digit numbers every year. What has failed to keep pace is the yield, the amount of money that each publisher gets on ads.
So they have not been able to participate on an individual basis in the explosive growth of the advertising industry. There are real-time exchanges and RTBs, which stands for real-time bidding. But it doesn't really stand for real-time bidding; it stands for race to the bottom.
There's a proliferation of low-value inventory in the marketplace, and that is what is really being driven by a lot of these automated systems. If you're a premium publisher, you're looking at this, saying, “Why aren't I getting premium yields anymore?” Our goal is to say to all the premium publishers, we're going to back you there trying to help you drive premium yields. To do that, we're taking all of these assets and putting them together in a way that helps monetize them.
DD: Can you talk specifically about what the elements of your group can add?Brody: Think of it as we can help you serve your inventory and decide how to best monetize your inventory through Adtech. Anything that you haven't sold we can actually help you sell through the Advertising.com network. We can help you drive your premium dollars by providing new premium format systems (through Pictela and Project Devil). If you have video, we can help you monetize it through 5min and GoViral. If you don't have video, we can bring it to you through 5min. If you don't have enough content, we can bring you original content through Seed or Studio Now. What we're really trying to do is establish ourselves as the business in this ecosystem that is out there to help publishers and help drive advertising dollars.
If you were a publisher, what you would see very quickly is that we would begin to bring you a much richer and broader set of products. Our goal quite frankly is to try to be a one-stop shop for the publisher as opposed to the point solutions you are required to buy today.